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Question - Surrey Manufacturing uses a standard cost system to collect costs related to the production of its garlic flavored yogurt. The garlic (materials) standards for each container of yogurt produced are 0.8 ounces of crushed garlic at a standard cost of $2.30 per ounce.
During the month of June, Surrey purchased 75,000 ounces of crushed garlic at a total cost of $171,000. Surrey used 64,000 of these ounces to produce 71,500 containers of yogurt.
The direct materials purchases variance is computed when the materials are purchased.
What is Surrey's materials price variance for June?
a. $1,500 Favorable
b. $15,640 Unfavorable
c. $17,250 Favorable
d. $23,800 Favorable
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